Turkey retail sales shrink in December after COVID-19 steps, rate hikes

Growth in Turkey’s retail sales turned negative in December, declining month-on-month for the first time since April and signaling a sharp economic slowdown.

Retail sales volume dropped by 4.2 percent compared with November, the Turkish Statistical Institute said on Friday. On an annual basis, sales grew by 0.6 percent versus 12.3 percent in November.

Consumer demand in Turkey is declining after the central bank increased interest rates and the government introduced lockdown measures to stem a second wave of COVID-19. The interest rate hikes total 8.75 percentage points since September, with the benchmark rate now standing at 17 percent.

Sales of non-food items dropped by 5.2 percent month-on-month in December, while purchases of food, drinks and tobacco fell by 2.3 percent, the institute said.

In a separate statement, the institute said industrial output rose by an annual 9 percent in December after an 11 percent increase in November. Production grew by 1.3 percent month-on-month, unchanged from November, it said.

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